Statistics Canada has had a surprising side business for decades. It employs 400 people full-time to package up data and sell it to private businesses. As David Akin reports, the agency makes a lot of cash doing this.

Navdeep Bains, the Trudeau cabinet minister responsible for Statistics Canada, said he first learned of the federal agency’s controversial plan to harvest the financial transaction data of potentially millions of Canadians as a result of media reports and not, as the law requires, in a written notification from the country’s chief statistician.

Bains’ revelation, made Monday at a House of Commons committee, follows a similar revelation earlier this month made by Canada’s privacy commissioner testifying at a Senate committee that, he, too, did not learn of the scope of the StatCan project until reading about it.

Global News first reported on the project on Oct. 26, and at the time, quoted StatCan documents that said the privacy commissioner had been fully briefed on the scope and nature of the project and also said that StatCan was also following all applicable laws, one of which includes a requirement that Statistics Canada notify in writing the responsible minister — Bains, in this case — when a project such as the one StatCan hopes to proceed with was being proposed.

Nonetheless, Bains, whose title is Minister for Innovation, Science and Economic Development, told a Commons committee Monday he has full faith in chief statistician Anil Arora and the agency he heads, Statistics Canada.

“I think that Statistics Canada is a world-class statistical agency. It has a lot of respect internationally and within Canada as well … and I have a lot of confidence in the chief statistician,” Bains said.

Arora was appointed by the Trudeau government in 2017.

WATCH: Bains says StatsCan never told him about bank project

For more than a year, StatCan has been developing a project in which it would randomly select 500,000 Canadian households, pass information such as social insurance numbers, names, and addresses of members of those households to the country’s nine largest financial institutions, and then require those financial institutions to transfer to Statistics Canada the daily detailed financial transaction data of any of its customers on the list of those 500,000 randomly selected Canadian households.

Statistics Canada has explained that upon receiving that data from the country’s banks and credit card companies, it would “anonymize” the data, stripping personal identifiers after aggregating the financial data with demographic data and use this method to replace a questionnaire it now uses to gather information about the household spending habits of Canadians.

In correspondence obtained by Global News directed to the banks, Statistics Canada claims the legal authority to require banks and credit card companies to turn over this data with neither the consent nor the knowledge of the affected customers of the financial institutions.

“Canadians continue to express their absolute rejection of the Liberal plan to secretly force banks and other financial institutions to release their personal financial information of their clients without their consent,” Conservative MP Dan Albas said Monday in the House of Commons.

Bains, on Monday, said he now understands that affected Canadians would be informed if their data was collected.

Bains and other government officials describe the plan as a “pilot project” that has yet to collect any data in this way.

“Your government has not done a very good job of managing Statistics Canada,” Conservative MP Michael Chong told Bains at Monday’s committee meeting. “This is data that is far more intrusive than anything we’ve seen before at a level that would make [Google subsidiary] Alphabet and Amazon blush.”

In the meantime, Conservative MPs had new questions Monday for both Bains and Statistics Canada about StatCan’s decades-old practice of selling custom slices of data it holds to the private sector and how that business might be affected by this new plan to harvest bank data.

“This data is going to be used by some of the largest companies in the world in order to market their services to Canadians and your government proposes to use the coercive power of the state … to get this data,” Chong said to Bains at Monday’s committee meeting. “I think it’s big-time overreach on part of your government.”

In 2017, StatCan posted $113 million of what it calls “re-spendable” revenue and employed 400 full-time data collectors for this custom data business.

StatCan saw this custom data business shrink by 25 per cent between 2012 and 2015 after the previous Harper government made the mandatory long-form census optional. Many social scientists said that decision made the census data next to useless. Many of Statistics Canada business customers appear to have thought so as well as StatCan’s revenue earned by selling its data dropped from $114 million in 2012 to $86 million in 2015.

But when the Trudeau Liberals made the long-form census mandatory again in 2015, gave Statistics Canada new independence, and provided it with new powers to create projects like the planned bank transaction data collection project, it appears to have made StatCan more valuable in the eyes of business users. StatCan’s sales to the private sector quickly blossomed by 32 per cent from 2015 to 2017.

Albas said he believes StatCan’s revenue from this custom data service will “skyrocket” when business users learn it includes data StatCan has forced from Canada’s banks and credit card companies.

“This information is highly valued by large multinationals who want to sell more of their products,” Albas said.

At no time does Statistics Canada sell or provide, under any circumstance, any personal information it holds. Instead, it packages up data about groups of Canadians, most often sorted by their “forward sort area” — the first three letters of someone’s postal code — so that businesses or marketing organizations might know where, for example, families with young children or Punjabi speakers live.

Albas said the proposed project to collect bank transaction data would make StatCan’s data even more valuable to business users — at the expense, he said, of the privacy rights of Canadians.